Vitorino set to drop e-commerce from Rome II in bid to clinch deal

Date: 11/10/01

By Peter Chapman

Justice chief António Vitorino looks set to cave in to demands from fellow Commissioner Frits Bolkestein and industry to exclude e-commerce and television services from his controversial 'Rome II' regulation.

The Vitorino blueprint, which sets out which law is applicable in disputes where a number of member states are involved, caused fury among businesses which could face legal claims from all over the EU's 15-country bloc.

This is because in a dispute, the applicable law would, in general, be from the country where 'the harm occurs' to the injured party. Industry groups said this could have left them vulnerable to swathes of unfamiliar foreign rules and regulations.

They feared it could have contradicted existing EU legislation on e-commerce and 'TV without frontiers' which states that firms can operate across the EU provided they fulfil legal requirements in their own member state or 'country of origin'.

The result would be another setback for the fledgling e-commerce market, seen as a potential engine of growth for the EU but now struggling to overcome the worst economic conditions for years.

But a leaked copy of the proposal seen by European Voice declares that Rome II would now not "apply to activities that are covered by country of origin directives". The climbdown follows intense lobbying by Bolkestein, whose job it is to promote the EU's single market and the country-of-origin measures which his department favours.

However experts say an internal debate is still raging between advisors to all 20 Commissioners over the ways in which the proposed regulation could affect traditional 'off-line' business. EU publishers fear they could be left vulnerable to defamation claims from anywhere in the Union where their products can be obtained - even if they had ensured their products met local defamation laws.

Industry also fears controversial 'unfair competition rules' could still be covered by the regulation. Some member states place tough restrictions on commercial activities of companies seeking to win customers from rivals, for example by using comparative advertising. If unfair competition is included in the regulation, British firms abiding by UK legislation for instance could fall foul of more restrictive German laws.

Angela Mills, director of the European Publishers Council, a group of publishing CEOs and chairmen from across the EU, said: "The whole initiative is flawed."

We think the Commission ought not to bother with it. "It is chipping away at established European community principles and established Community law. That is why the Commission is so unsettled. It throws into question whole areas which we previously agreed on."

Justice chief António Vitorino looks set to cave in to demands from fellow Commissioner Frits Bolkestein and industry to exclude e-commerce and television services from his controversial 'Rome II' regulation.